Why we’re fighting for green energy

27 July 2012

Working on energy policy is critical for WWF. Our energy experts are part of our vitally important climate change team, reflecting the fact that the world urgently needs to move away from high-carbon fossil fuels if we’re to have any chance of avoiding dangerous levels of global warming. That’s a huge challenge - but we’re clear that the solutions lie in clean renewable energy and using energy more wisely.

The ‘decarbonising’ of our energy systems is a priority area of work for both WWF-UK and our global network.

Here in Britain, we have a golden opportunity to start creating a green, secure and cost-effective energy system right now. The government is in the process of conducting an Energy Market Review, which will determine the balance of renewable energy, nuclear and fossil fuels in our energy mix for the decades to come.

These changes will be set in law by the government’s Energy Bill, currently in draft form, which will start its slow progress through the parliament in the autumn.

"If the Energy Bill does not set a target to largely decarbonise the electricity sector by 2030, then the UK may miss one of the biggest opportunities it has to create a low-carbon economy in the most cost-effective way."

In response, our own chief executive David Nussbaum questioned why the treasury was so intent on undermining energy policy in the UK. David said that the chancellor George Osborne and the treasury were looking “increasingly isolated” on energy policy, and pointed specifically to their failure to agree support levels for onshore wind.

Businesses had expected the government to agree a reduction in subsidy levels for onshore wind – a 10% cut was widely seen as reasonable – but there were reports that, in response to backbench pressure to cut subsidy levels dramatically, Mr Osborne was seeking deeper cuts of up to 25%.

This prompted our CEO to suggest that the government’s failure to agree support levels for onshore wind “might appeal to a narrow political faction, but is clearly not in the national interest.”

Also on Monday, news emerged that the Scottish government, which historically set subsidies at the same level as those in the rest of the UK, had lost patience with the coalition’s delaying on the issue and moved to agree the 10% cut.

But then, in a dramatic new twist to the story, the Financial Times revealed the contents of a letter from the chancellor to energy secretary Ed Davey, in which he set out a range of conditions for agreeing to the 10% cut. These included renewed support for gas in electricity generation in the UK, the abandoning of decarbonisation or renewable energy targets, and the commitment to further reviews of renewable subsidy levels.

The 10% cut was finally agreed, but it was a hollow victory for supporters of renewable energy - and remarkably the announcement was accompanied by a £500 million tax break for gas companies.

Overall, this week's developments were merely an opening skirmish in the ongoing battle between the energy department and the treasury.

Our deep concern about the political wrangling over such an important issue promoted David Nussbaum to write a letter to the prime minister, pointing out the dangers of increased reliance on fossil fuels, the impact that the lack of policy certainty was having on businesses, and that the green economy more widely is one of the few parts of the UK economy showing strong growth.

Put simply, George Osborne’s insistence on backing more gas in our energy mix and the lack of support for renewables is, we believe, highly risky.

The government’s own Committee on Climate Change has warned that another ‘dash for gas’ would be incompatible with meeting our carbon reduction targets and is not economically sensible.

It’s also clear that the ongoing uncertainly over energy policy is severely damaging the UK’s ability to become a world leader in renewable energy.

Energy policy is set to be a major battleground for WWF, both here in the UK and globally - so watch this space for more to come.